Revel Atlantic City announced that they will refund the total amount lost on slot machines (including Video Poker) between $100-$100,000 in the month of July for all players. Refunds will come in the form of free slot play, and will be awarded at 5% of the loss per week over 20 weeks. You must be present each week to claim the refund, else you lose it for that week.

Any thoughts on the best way to maximize EV on this promotion? Or, any direction to resources that could help?

My guess is that a strategy would look like:

• Player has $X willing to risk at this promotion
• In July, player takes one trip, and plays until he has won Y% of $X, or has lost $X entirely
• If player wins in July, stop
• If player loses $X in July, return each week to collect free play; cycle free play and cash out when free play is done

If this is the strategy, then

• What is Y?
• Does Y vary with different X's?
• Should the player play games with the lowest house edge? Or highest jackpot possible?
• Is the game type choice different for the July trip vs. the trips where cashing in free play?

I don’t know if your strategy is good nor do I know if I can devise a better one. What I do know or at least think strongly about is that the casino is not going to offer a game where it loses money. So, while maximizing EV is a worthy goal, I feel pretty certain that whatever that maximum is, it will be negative – at least over the population of slot players who take ‘advantage’ of the offer. That doesn’t mean some really smart person cannot figure out some +EV strategy but if he did, he may make a lot of money by selling it with guarantees. Since the casino knows this, I would think they would have even smarter people figure out that no such strategy exists.

One possibility to counter the above is that somehow the promotion gets people hooked on playing the slots so to use a poker metaphor, it is a meta-slot strategy on their part. I don't think this is the case, but who knows.

Can an individual make money with this promotion? Of course, just like he can without the promotion. Can he do better with the promotion? Sure. Can he be +EV prior to playing? I strongly doubt it.

According to WizardOfOdds, the house edge in Jacks Or Better is only 0.46% with optimal play. Though I don't know if Revel's version is "full pay".

I can't imagine that Revel is offering +EV but without having done calculations, I feel like video poker would be +EV with that promotion. I guess I'll post some calculations another time to see if it really is.

Thanks for the input. Couple of counters/bits of extra info:

I'm not sure how familiar you are with the AC market, but for background, Revel was a $2B+ resort that was started in 2009, stalled for 2 years half constructed, then finished in 2012 after a lot of political help from Christie. It's an extremely nice facility, however it's in AC, and not in a nice part of AC. The property has struggled mightily since opening, often ranking last or near-last in gaming revenue. They started with a marketing/operating strategy that they were a resort first, that happened to offer gaming, and not a typical casino. They did not offer many things that typical AC gamblers are accustomed to: they were non-smoking (only property in AC), no buffet or cheap food options, and no players' lounge, for starters. Hence, they have not been able to attract gaming customers. After ~ 1 year of operation, the property declared bankruptcy a few months ago, changed GMs, and outsourced their marketing department. They have reversed course in many respects: they now offer smoking, they are building a players lounge, and they changed the name of the property from Revel Resort to Revel Casino-Hotel. Their new marketing slogan is "Gamblers Wanted", or some such.

Anyway, this promotion is part of their rebranding/marketing effort. They are attempting to attract the AC slot player who originally wrote them off by offering such a rich promotion. Plus, by making the players have to earn their free play weekly over 20 weeks, they expect to ensure either lots of trips to the property, or lots of breakage on the promotion. Meanwhile, they hope to quickly grow their database. Given this, I think they have indeed set up a promotion where the player is +EV heading in, if they are willing/able to collect all of their free play.

Regarding the promotion itself, consider a simplified version with a simple theoretical machine. Forget the refund coming in 20 separate pieces, and pretend that the promotion was as follows - you play a slot machine, if you win you win, and if you lose they refund 100% of your loss in free slot play. Now, pretend there is a $100 slot machine with the following odds and payouts:

2% +1000
15% +200
19% +50
64% -100

This machine would on average lose the player $4.50 per spin, so 95.5% payback/4.5% house edge. If I played one $100 spin on this machine with this promotion, I calculate:

2% - win 1000, 20 EV
15% - win 200, 30 EV
19% - win 50, 9.5 EV
64% - Lose, get Refunded, Spin again w/ Free Slot Play

• 64% * 2% = 1.3% - Win 1000, 12.8 EV
• 64% * 15% = 9.6% - Win 200, 19.2 EV
• 64% * 19% = 12.2% - Win 50, 6.1 EV
• 64% * 64% = 41% - Lose 100, -41 EV

In total, I lose my $100 just 41% of the time, and my EV for the promotion is +56.6. This is obviously simplified from a real scenario, but I think it's the same vein of what actually playing out this promotion would look like. I'd be surprised if expected ROI is less than 25% assuming you are able to collect and redeem all 20 of the refunds, ignoring travel costs and cost of your time. That said, I'm certainly no probability expert, happy to hear about what I'm not considering?

Thx

I am not certain but...
This doesn't seem like the best way to look at it unless you are only actually playing one game. The house will only let you re-play for the extra money you lost at the end of the month, not on a per game basis
If you play the first game and win $1000 you don't get any free goes at all unless you keep playing and then lose all this extra and more.
You are only allowed to try to win back the money you lost by using a machine that will be in favor of the house so on average you won't win all this loss back.
If you played 10000 games (costing $1,000,000) you would on average lose $45000 (if your init calc was correct).
Over the next 20 weeks the house would let you play 450/20 games per week using free goes to try to recoup this $45000.
On average you would get back 95.5% of this $45000, so you get $42975 so on average you still lose about $2000.

I would suggest the best strategy would be to play one game at nosebleed stakes, take the money if you win and play lots of low cost games to recoup most of the lost money without too much risk of a complete loss.

If the house will only let you play the same machine/game you lost at then still play one game but you would have to consider the possiblity of a complete loss so don't do it without being able to take the hit. I would also look very, very closely into the small print of the offer as you could easily get caught out by some unrealised restriction.

If you have to play lots of games the house is really only reducing it's edge and trapping you into returning several times to try to reduce your losses.

Thanks for the reply, a couple other thoughts:

Yes I don't get any refund, but I've won money in total - I'm happy in this scenario.

Agreed, if I go bust on the first try then my expectation going forward is to end up losing money. But I get to a total positive NPV for the promotion because of the possibility I win money on the initial play (in my simple example, I have a 36% chance of making money on the initial spin).

I think this is discounting the fact that if I win, I stop playing with a positive return. I may be wrong though?

It just occurred to me that in my simple example, I stop playing after I win. However, if I win, then I now have more available money to invest, and I have what I think is a +EV situation, which I think would imply the right move would be to turn around and re-invest the money. Of course this would loop forever until I ended up losing, which would put me in a -EV scenario. So I'm back to my original question of "What is Y?", or what is the correct target amount to win? This is assuming you want to invest more than you can play on one spin of a machine.

If you are playing many games then yes you could always stop if you ever go ahead. If the games are all for small amounts of money you won't win much even if a bit lucky, when you lose often it may not be for enough to make it worth coming back into the casino over the future weeks so you would end up throwing away some of these future options. If you lose big over many small games coming back in won't usually recoup these losses, you only get back 95.5% of it.

If you can play the one big one (not likely possible at slots) and play off the loss with lots of very small games, ie, getting to the long run for this part, you gain the chance of a big win without too much risk.

If you have to play several thousand games up front the chance of being ahead at the end is really, really small due to the house edge and also you do have to be careful that you factor in the practical problems losing pretty small amounts overall will bring.
I think the offer is likely to be good only to people that already like to play slots and are already regulars.
It seems tempting but if you play lots of games the house will only have reduced it's edge really and you still lose out overall.

I'd want to look at the small print for how the free play is handled. Say you have $1000 free play for the week, play $5 slots, and start out winning a little but never enough to be worth quiting. So you keep grinding away with what ought to be your own money, staying a little bit ahead until you've played 200 $5 pulls. Then, when you drift back to even you expect them to give you some more of your free play since you think you've only used up the first free $5 pull that got you started out winning. But to your suprise they tell you no. You've had your 200 $5 pulls so you've used up your $1000 free play for the week.


PairTheBoard

EV is roughly $44,000 for the $100k loss